As Asian internet expands, maintaining democratic governance is key

As Asian internet expands, maintaining democratic governance is key

Asia is emerging as one of the world’s great beneficiaries of this period of significant global expansion of the Internet. Comprising roughly half of global population and GDP, the continent is now home to over half of Internet users, while its 5% economic growth forecast in 2023 makes it the fastest-growing region in the world. Although Asia’s internet penetration rate of 67.4% falls marginally below the global average of 71%, this rate has remarkably more than doubled since 2011, with the hotbed of Southeast Asia driving a large part of this expansion in Internet access.

Southeast Asia boasts a thriving digital ecosystem on a sharp upward trajectory, composed of 460 million internet users - 100 million of which have connected to the Internet in just the past three years due to theimpact of COVID-19 - and a rapidly developing digital economy that is expected to nearly double by 2025 to an impressive $330 billion, fueled by six of the region’s digital heavy hitters, namely Indonesia, Malaysia, Singapore, Thailand, the Philippinesand Vietnam. What’s more, the region is the second fastest-growing globally in terms of Internet users, creating significant opportunities for transformative socioeconomic development.

Unsung foundation of Internet expansion

While the wide expansion of digital infrastructure occurring in Asia, such as new subsea broadband cables and data centres, is undoubtedly playing a crucial role in its digital transformation, the Internet Governance ecosystem’s contribution has gone largely overlooked.

APNIC, the Regional Internet Registry (RIR) for the 56 economies in Asia and Oceania, has been at the core of this governance effort since the Internet’s early days in the 1990s.Like the world’s other four RIRs, APNIC allocates and registers IP addresses, without which connecting to the Internet and accessing online content would be impossible. In keeping with the original Internet governance models, APNIC has provided this vital service to Internet Service Provider (ISP) clients in its designated Asia-Pacific territory, enabling these so-called “resource members” to provide Internet connection services to companies and households.

Founded in Tokyo, APNIC later migrated to its current home in Brisbane, Australia at the end of last century, from where it oversaw a transformative period for the Internet, during which global users soared from 400 million in 2000 to 2 billion by 2010and the Internet increasingly became a crucial part of everyday life. This expansion, and consequent depletion of finite IPv4 addresses, made APNIC’s role in ensuring a fair and equitable distribution of IP resources on the continent increasingly important.

Democratic deficit controversy brewing

While it has made significant contributions to the development of Asia’s digital ecosystem, controversy has emergedin January within APNIC’s resource member communityover the organisation’s governance structure and ownership. Considering that RIRs were initially founded on a “bottom-up,” community-driven model to ensure that the Internet would remain an open and inclusive space whose development would be guided by users’ interests, recent revelations have raised several important questions.

An APNIC community member recentlypointed out publicly available company information in the Australian Securities and Investments Commission (ASIC) database that shows APNIC – legally APNIC Pty Ltd – to be a private company with a sole share owned by APNIC Director General and Secretary, Paul Wilson, who has held these positions since 1998, leading to concerns that APNIC’s structure was not nearly as democratic as previously believed.

Jeremy Harrison, APNIC’s senior legal counsel, has responded to the concerns, confirming that APNIC in fact has that corporate structure, but explaining that the public-facing, member-led organisation known as “APNIC” is legally a “Special Committee of the Board of APNIC Pty Ltd,” which elects the Executive Council that in turn exercises directorial and decision-making powers, with the sole-share APNIC Pty Ltd acting as a holding company of sorts. Moreover, Harrison claims that this one share is held on trust for the Executive Council of APNIC, with the Executive Council choosing who holds the share as trustee.”In his written explanation, Harrison further posits that the Executive Council is the “beneficial owner” of the sole APNIC share, while Director General Paul Wilson, as trustee, is simply the “legal holder,” who “cannot do anything with the share without the approval of the Executive Council.”

A community member subsequentlyquestioned this claim, citing lack of public evidence of Paul Wilson’s role as trustee, as well as the apparent lack of an adequate system of checks and balances between the Director General role and the Executive Council. While not illegal, this corporate structure would appear to conflict with APNIC’s public image as an “open, membership-based organisation,” and the traditional “bottom-up,” multistakeholder model of Internet Governance. Concretely, this concentration of powerseemingly creates a unstable democratic deficit within APNIC’s governance, considering the potential risk that Wilson, as Director General, Secretary and sole shareholder, could override the will of an Executive Council without clear authority to act as balancing power representing the democratic will of the resource member community.

Importance of bottom-up internet governance

The bottom-up, multistakeholder Internet governance model that certain APNIC members believe is at risk has long been considered the foundation for an open, democratic and inclusive expansion of the Internet. Fundamentally, this model empowers those at the core of digital ecosystems, including the smallest ISPs, to influence Internet policymaking and contribute to collective action, as opposed to a top-down model in which a governmental, or intergovernmental body, sets regulations that smaller organisations abide by without input.

This model will be key in the coming years, considering that APNIC’s territory still has a long way to go in its digital transformation. Despite its impressive Internet penetration, nearly 40% of Southeast Asia’s population does not get online once per month. Moreover, the region faces a considerable digital divide between more and less developed economies, which have access rates of roughly 75% and 60%, respectively, that will need to be tackled to ensure the socioeconomic benefits of digitalization are enjoyed inclusively and sustainably.